Interview: Trubanc Creator Bill St. Clair Explains Value Transfer Software

Interviewed by Mark Herpel
Digital Gold Currency Magazine
May 2009

http://www.dgcmagazine.com/dp/node/95

Bill is an extraordinary software designer/creator with a love for gold and silver. His informal value transfer software (IVTS) is called Trubanc and allows anyone to create their own private online ‘banc’ with easy to use, easy to install and highly adaptable software. Once the banc is online, anyone can then also create as many digital currencies they desire for any particular purpose they desire. Bill is also big fan of digital gold and digital currency. Here is my email interview.

(Q) In terms of digital gold currency and freedom, how would you describe yourself?

First off, thanks for the kind words. As it says on my blog, I self-classify as crypto-anarcho-libertarian. Crypto because I program computers and like cryptography. Anarcho because I believe in rules, but not rulers, the primary rule being self ownership. Libertarian because I practice, to the best of my ability, the Zero Aggression Principle: no one has the right, under any circumstances, to initiate force, nor to advocate or delegate the initiation of force. I believe people should be able to trade using whatever currency makes that trading easiest and most convenient for them. Precious metals, e.g. gold, have historically been widely found useful as a trading medium. Making them digital increases ease of use.

(Q) How long have you been using digital gold currency and other digital currencies?

I read David Chaum’s digital cash papers many years ago. I dabbled in e-gold when it was new, but never did anything with my account. I discovered Patrick Chkoreff’s Loom system (https://loom.cc) in December of 2007. Loom was the first digital gold currency system in which I did any real trading. I used a Pecunix account to pay for my new web host, hub.org, and the fact that they accepted Pecunix was a big selling point.

(Q) For online commerce, do you also use a credit card to make purchases?

I use a debit card to do most of my online commerce. Most of the places I buy stuff don’t take DGCs.

(Q) So in your opinion, will digital gold currency replace online banking and the US Dollar?

Though I’d love for that to happen, I don’t see DGCs taking over any time soon. The credit card system is a huge entrenched market. And most people have no concept of the problems of fiat currencies. One would hope that they’d learn from the current economic crisis, but I doubt that they will.

(Q) Right now in about 6 U.S. States, there are honest money bills pending that would allow the use of digital gold as a voluntary system of payment for citizens. The bills would also allow some states to accept actual gold and silver as payment for certain taxes and fees. Do you agree with these bills that gold and silver honest money legislation is a good thing or should we all just shut up and use what the Federal government tells us is money?

I wish them luck. The U.S. Constitution gives the federal government the authority to mint gold and silver coins. Period. No mention of any authority to print fiat money, backed only by “In God We Trust”, nor to delegate control of the money supply to a private company like the Federal Reserve. So these honest money bills are a welcome return to Constitutional money.

(Q) Which do you prefer for online business, the plastic or digital gold? Why?

I like the idea of digital gold, but have some reservations, given the theft by government of e-gold and Liberty Reserve assets and the prevalence of fraud by some DGC providers. But I think the DGC world is maturing, and hope one day soon to be able to direct my employer to deposit my pay into a digital gold account, and to be able to use it at amazon.com and at the web sites of other mass-market vendors. For now, though, my only choice for auto-deposit of my paycheck is a conventional bank, and my only choice for paying most online merchants is a credit or debit card, or PayPal. So I use them.

(Q) Has anyone ever gained control of any digital gold account you operate and used it without your permission?

No.

(Q) What is the main reason you would use digital gold currency? Safety, privacy, speed etc?

Privacy is paramount, hence my work on Trubanc. Also, credit card systems are pull systems. The merchant tells the credit card company that a purchaser has given permission for a debit. And the credit card company believes it. The customer can contest the debit, and the state’s guns supposedly prevent losing more than $50 to fraudulent use, but fraud is basically built in to the system. With a reputable DGC provider, it’s much different. Every spend must be approved by the customer, and, an advantage for the vendor, spends are final. PayPal actually does a pretty good job of making credit card purchases safe. They prevent you having to give your credit card information to the merchant. But you have to trust PayPal, just as you have to trust your DGC provider.

(Q) When did you first begin to develop the Trubanc software?

My first commit was on July 29, 2008. My first blog post about Trubanc was on July 31, 2008. The idea grew out of online chat discussions with Patrick Chkeroff.

(Q) What exactly is a ‘Trubanc’ and what can I do with one?

Trubanc is an anonymous digitally-signed vault and trading system. It’s account-based. Each account be split up into a number of named compartments, sort of like checking and savings in a conventional bank, but named whatever you want. Each compartment tracks balances in any number of digital assets. Like Loom, anyone can create their own digital asset (currency), backed by anything or nothing. Though I think that assets backed by gold or silver are more likely to be accepted. You create an account on a Trubanc server with a PGP public key. The corresponding private key is stored, encrypted with a passphrase, on your PC, or on a client web server. All messages between client and server are digitally-signed, a virtually unforgettable validation method, unless somebody steals your private key and passphrase, and assuming that PGP has no backdoors and is practically impossible to break, valid assumptions as far as I know.

Account balances are time stamped, digitally-signed by the customer, and counter-signed by the bank, so each can prove to the other that they agreed at a particular time on the balance in each asset. If the customer can prove that his balance at time X was Y grams, and the bank cannot prove it was different at a later time, then the bank must believe the customer and adjust his balance accordingly. I haven’t yet implemented that correction mechanism. Trubanc storage is paid for with “usage tokens”, a bank-issued asset. The storage is file-based, and one file costs one usage token. I expect the cost of one usage token at most banks will be somewhere around one U.S. cent, but that isn’t built in to the software anywhere.

As with most DGC systems, you can make a spend to another Trubanc user, on the same server, if you know their ID. Trubanc allows you to attach a note to the spend, and allows the recipient to accept or reject the spend, again attaching a note. So it’s also a simple messaging system, since you can do a zerospend whose only purpose is to deliver a message. The usage tokens reduce spam, since making a spend costs 2 usage tokens, which you get back if the recipient accepts the spend, but which go to the recipient if he rejects it.

A spend can be cancelled until the recipient accepts or rejects it, but once accepted, the spend is final. The bank takes the 2 usage tokens if you cancel a spend. You can also mint your own Trubanc “coupons”, which you can mail or chat to someone outside of a Trubanc server, and which they can redeem on the server. A coupon for usage tokens is how most people will gain the ability to create a new account. Asset issuers can charge storage fees, a percentage of each account balance, collected on each transaction, and periodically by the bank, at the issuer’s request.

I plan to build a merchant interface, which will work much like PayPal or Pecunix, allowing an internet vendor to enter a proposed payment into the customer’s Trubanc client, which he must approve before the sale can be completed.

(Q) The Trubanc software for creating a value transfer system is free, correct?

Yes.

(Q) Would you call it open source?

Yes. The source is available on Trubanc.com and in the GIT archive at github.com/billstclair.

(Q) Is the Trubanc system available to anyone who wants one? How does a reader get one?

Yes. Go to http://trubanc.com, and you should see how to get it. There’s an INSTALL file that explains how to set up the PHP version. I’m currently working on a Lisp version, which will have a one-file executable for client or server, complete with a web interface for configuration. The PHP version works, but I consider it a prototype. The lisp version will be more bullet-proof, and easier to use, though it requires a stand-alone server, or virtual server, not just a PHP web host.

(Q) What features of digital gold currency and Trubanc do you feel are the most important?

That’s really two questions. I’ll answer about Trubanc. Privacy and security are Trubanc’s claim to fame. You don’t need to tell the bank anything about yourself except your PGP public key. And the bank cannot change your balance without your permission, though it can post storage charges to your account, which you have to accept to be able to do any more spends from that account.

(Q) Why would anyone around the world, use Trubanc over say...Bank of America’s online banking?

Privacy and security.

(Q) What countries do you feel are the biggest markets for products such as Trubanc?

Trubanc itself isn’t really a product; it’s free. I hope I can earn some assets supporting Trubanc installations, but I intend for the code itself to remain free and open source. As to which countries are the best places to host Trubanc servers, I haven’t thought about it. Trubanc.com is hosted in Panama by a Canadian company.

One of Trubanc’s biggest hurdles is that governments do not like anonymous banking. If they can’t track your spends, they can’t collect taxes on them. So though I think that lots of United States residents would want to use a Trubanc, hosting one on a US server is a really bad idea, since the US government is likely to shut it down. Whether they’ll make it illegal to USE a Trubanc, hosted outside of the US, remains to be seen.

I’d like to thank Bill for taking time to answer my questions and provide us with this valuable information. If you would like to try out your own Trubanc we encourage you to download from his web and set up your own bank. Reprinted with permission.

For further reading:
"Anonymous internet banking", Wikipedia, the free encyclopedia
"Trubanc The Newest Secure Value Transfer System", Mark Herpel, DGC Magazine, January 2009